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Eastman Kodak Co. reached a deal with bondholders for $793 million in loans that could help take the onetime photography icon out of bankruptcy proceedings if it sells a collection of patents for at least $500 million, the Wall Street Journal reported yesterday. Some Kodak bondholders, however, criticized the company in court saying that it had "squandered" the 10 months it had been in bankruptcy protection by pinning its hopes on the patent sale. Bondholders including Centerbridge Partners LP, GSO Capital Partners LP, JPMorgan Securities LLC and UBS AG are providing Kodak with the new financing. Kodak's board met Sunday night to approve the package.

Bondholders who have gone unpaid by struggling Ampal-American Israel Corp. have turned to a judge for help in taking control of the company's stalled bankruptcy case, which they said is unfairly protecting Israeli billionaire Yosef A. Maiman from losing his controlling ownership in the energy and transportation holding company, Dow Jones DBR Small Cap reported today. The unsecured creditors' committee, most of whom are bondholders, wants Bankruptcy Judge Stuart M. Bernstein to let the committee's attorneys put together a plan to get the company out of chapter 11 bankruptcy protection---a plan that they say company executives have failed to make progress on since the case was filed on Aug. 29.

San Bernardino's and Compton's disputes with CalPERS, the state's public employee pension fund, could have ramifications for other cities and their creditors, credit rating firm Moody's said in a new report, the Los Angeles Times reported today. "These situations could open the door for courts to decide whether pension payments can be legally suspended or modified if a California local government is in financial distress and/or bankruptcy," Moody's wrote in its weekly credit outlook released on Friday. On one hand, the report warned that if the financially troubled cities succeed in delaying or reducing their CalPERS payments, it "could incentivize other financially distressed cities to seek concessions from all creditors," including bondholders. On the other hand, if cities are not required to make full pension payments while in bankruptcy, the report said, more might be left for other creditors, including bondholders.

Chasing down money owed in a 14-year-old legal dispute, Michigan real estate investor David Clapper is trying to eject American Realty Trust Inc. from bankruptcy court, arguing that the trust company's chapter 11 filing in August was another attempt to delay paying Clapper and his businesses a $73 million judgment, Dow Jones DBR Small Cap reported today. In the court papers filed on Tuesday, Clapper accused the controller of American Realty Trust of trying to avoid payment by gradually transferring assets and ownership to its successor company, Dallas-based American Realty Investors Inc., which is not in bankruptcy.

Defunct Lehman Brothers Holdings Inc. and its affiliates had $14.3 billion in restricted cash on Sept. 30, including $10.9 billion of reserves for claims, Bloomberg News reported yesterday. Free cash and investments totaled almost $11 billion, according to a court filing. The claim reserves include $5.8 billion held for disputed amounts, Lehman said. The former investment bank plans two payments to creditors every year. The last payment was Oct. 1. Lehman, which four years after filing the biggest U.S. bankruptcy continues to sell assets to pay creditors, made a first payment of $22.5 billion in April and a second installment of $10.2 billion this month.

The Dewey & LeBoeuf estate has begun to try to whittle away some of the thousands of claims asserted by aggrieved creditors hoping to recover at least a portion of what they say Dewey owes them, the American Law Daily reported today. To date, more than 2,100 proofs of claim have been filed against Dewey, which became the largest law firm in U.S. history to fail when it filed for chapter 11 protection on May 28. Those submitting the claims—which range from a low of $10 up to several million dollars—include vendors, former firm staffers, and landlords. Dewey’s advisers have said they believe that all told, the estate owes creditors $260 million in secured debt and $300 million $500 million more in unsecured claims. In a pair of filings made on October 26, the Dewey estate seeks to invalidate several dozen claims that they say are duplicative or were submitted after the September 7 deadline.

A federal judge on Monday handed partial victories to both the Archdiocese of Milwaukee, Wis., and the sex abuse victims who make up the vast majority of creditors in its bankruptcy, the Milwaukee Journal Sentinel reported yesterday. The ruling, by U.S. District Judge Rudolph Randa, lets stand a February decision by Bankruptcy Judge Susan V. Kelley dismissing one victim's claim and allowing two others to move forward, at least for now. The three cases were seen as test cases in which the archdiocese argued that a significant number of victims of clergy sexual abuse had enough information on the church's handling of cases to have filed fraud claims years earlier, and that the statute of limitations expired before those victims stepped forward. It also sought to exclude cases that involve religious offenders, teachers and others it does not consider its employees, and cases where the victims received prior settlements.

Bankruptcy Judge Christopher Sontchi told Japanese chipmaker Elpida Memory Inc. that he was "troubled" by the firm's inadequate efforts to keep creditors informed about its bankruptcy process, and warned he may upend its proposed sale to U.S. rival Micron Technology Inc., Reuters reported yesterday Elpida's main bankruptcy proceeding is being handled by a district court in Tokyo, but Judge Sontchi said that the company was taking a risk by not keeping creditors better informed. Judge Sontchi will eventually have to approve the transfer of U.S. assets after a sale is cleared by the Japanese court.

LSP Energy is seeking to keep exclusive control over its Chapter 11 case as it works to close on the sale of its assets and end an outage that's taken its gas-fired Mississippi power offline, Dow Jones DBR Small Cap reported today. In court papers filed on, the company asked for an extension through Nov. 21 of its exclusive right to file a creditor payment plan. The extension would prevent creditors from filing rival plans while LSP works to complete its own. The company's current plan-filing deadline is Oct. 22.

A bidding war for A123 Systems Inc., the electric car battery maker that has filed for creditor protection, broke out in bankruptcy court between a spurned Chinese suitor and an American auto-parts maker, the Wall Street Journal reported today. A lawyer for Chinese auto-parts maker Wanxiang Group Corp. indicated at an initial hearing in Wilmington, Del., that the company is still interested in A123 despite a $125 million offer from Milwaukee-based Johnson Controls Inc. for the battery maker's auto business. The disclosure sets up a fight between Wanxiang and Johnson Controls, which has agreed to provide A123 with $72.5 million in debtor-in-possession financing to fund the bankruptcy case. D.J. "Jan" Baker, A123's bankruptcy attorney, said that the company would seek approval of the Johnson Controls loan only on an "interim" basis in order to shop for better financing terms.